A new report has revealed the extent of the lack of ethnic diversity in senior roles in the FTSE 100. It shows how at the current rate it will take over 200 years for the leadership of the UK’s top listed firms to match the diversity of the working population. The survey, conducted by Green Park, found that collectively just 11 ‘top tier’ leadership roles – CEO, CFO and chair – were filled with individuals from an ethnic minority background. There was just one more top tier ethnic minority leader than in 2014.
The news is covered by People Management which highlights the criticism of the diversity and inclusion departments in FTSE 100 firms which, the reports shows, are one of the least diverse parts of the corporate world. Less than a third of D&I focused roles were held by ethnic minority leaders and just three of the D&I leaders who were surveyed sat at the board and executive committee level. The report suggests this evidence that the D&I function is not considered by most FTSE 100 organisations as a pathway to the top positions.
More broadly, the report found the functions more likely to lead to the most senior positions were overwhelmingly dominated by men. These included commercial and procurement, which was 82.8 per cent male; finance, which was 83.5 per cent male; and digital, data and technology, which was 78.8 per cent male. Dr Scarlett Brown, corporate governance lead at the CIPD, is quoted saying employers need to give more consideration as to why certain sectors were viewed as more likely to lead to a c-suite position, and that boards and recruiters needed to think more broadly about the kinds of experience that are valuable.
Our own diversity and inclusion specialist, Kate Dodd, has been looking at the report and she joined me by video-link from Manchester to discuss it. She told me she was concerned by the findings:
Kate Dodd: “It was a really shocking read actually and maybe I'm a little bit naive but becau se so many businesses have been really focusing on race and ethnicity, and have been really making great noises, great efforts, around increasing minority ethnic representation in their businesses, particularly since last summer and the tragic events surrounding George Floyd, I really thought when I saw this that there was going to be good progress and. I have to say, I was really shocked and felt pretty down about the fact that actually there hasn't been the progress and we're expecting to see and for some reason those good intentions don't seem to be translating into actual results.”
Joe Glavina: “So in practical terms what can be done about it?”
Kate Dodd: “I think there has to be a targeted approach; I don't think one thing is going to solve this for any business. So it has to be a really well thought out strategy. I think the key things in there are going to be around being relentless, not just thinking, right, we've got this as an ambition, we hope it's going to work, we're going to do some events, we're going to have some initiatives and let's hope that that is going to be enough for us. It's not, and the fact that this hasn't happened, and the fact there have been so many events and so many amazing initiatives and it isn't translating into board numbers shows that there has to be more. So you have to have that relentless approach to this. There has, of course got to be board buy in, so people on the board need to accept that this is a problem and that they have to do something about it. Then going forward I think the recruitment point is really key. It is no longer going to be acceptable when you’re recruiting into these three key positions - the CFO, the chair, and the CEO - if you aren't being given a candidate slate, you know, you're being sent forward your potential interviewees, if you look at that, and there is no minority ethnic talent in that list you need to reject it. You need to just say look I'm sorry, we’re not just going to say, oh, you know, we're struggling to find people this time, you need to be rejecting that and saying go away, try again, try harder. Also, engage with minority ethnic agencies, go out and find recruitment specialists who are themselves either minority ethnic, or who have representation within their own business, so that you're having that expertise there as well. Then, of course, once you've got people coming in for interview, it's making sure you've got a diverse interview panel, making sure that those individuals are also representative. Then, of course, I think one of the most important things is to look internally, it's growing your own talent. You could say, well look there must be a shortage, but if there is a shortage of a particular role, if there's particular skill set that you’re looking for, and you're going out to your agents, and you’re saying bring me minority ethnic talent so that I can interview them in these talent pools and your agencies, or your recruiters, whoever it is, are saying there's nobody out there looking for a move, then you need to be looking at levels below that and you need to be thinking about the future, you need to be thinking about how you can help to bring those people into your businesses and bring them on to be the next board members, to be the next people who you're going to be recruiting internally into those positions. Then as a final point, if you lose people who are from minority ethnic backgrounds, you need to find out why. It shouldn’t just be your bog standard HR exit interview. You need to be having very soul searching, very confidential, conversations with those individuals to say we're disappointed that you've chosen to go and we would love to know what's happening, because if there is an issue around your culture you need to understand what that is because, of course, it's not just about attracting and recruiting, it’s also about retaining.”
That report by Green Park is their ‘Business Leaders Index 2021 – FTSE 100 – A Review of the Gender and Ethnocultural Diversity Composition of UK’s most Senior Leadership’. You can download it from Green Park’s website and we have put a link to that in the transcript of this programme.
- Link to ‘Business Index Leaders Index 2021 – FTSE 100 – A Review of the Gender and Ethnocultural Diversity Composition of UK’s most Senior Leadership’